At the Wall Street Journalis All Things Digital Conference, Bill Gates and Steve Ballmer said that Vista is not a failure and not a mistake, then provided a tantalizing demo of the new features in Windows 7.

Mr. Ballmer discussed some current happenings with Walt Mossberg and Kara Swisher: the patience they intend to have regarding Yahoo, a contemplated research group on search, and Mr. Ballmeris current fixation, cloud computing.

Regarding Vista, Mr. Ballmer said, "Vista is not a failure and not a mistake," but also admitted that they would do some things differently if they had it to do again. Future releases, according to Mr. Ballmer, will "do better" on compatibility, managing security and UI changes.

Various Microsoft spokespersons have varied on the date for Windows 7, but Gates and Ballmer used a date of late 2009. In a short demo of Windows 7, the duo showed gesture support derived from their Surface technology, photo management, and a mapping program. The use of these technologies will require special displays. Mr. Gates reitereated his belief that voice recognition will be the UI in the long run, saying, "In the next few years, the roles of speech, gesture, vision, ink, all of those will become huge. For the person at home and the person at work, that interaction will change dramatically."

Finally, when Mr. Mossberg pointed out that Apple has been much better at gettng its OS releases out, Mr. Ballmer countered "We sell 270 millions PCs a year, and Apple sells 10 million. They’re fantastically successful, and so are we."